Is it better to use tabs instead of a dropdown menu in a contact form?
Both of the options can provide good user experience if they are used properly.
In your case, the drop-down provides a better user experience for the following reasons:
Tabs are good when you have content that is different in each section. Drop downs are good for selecting a variable in one field.
Tab is for navigation, drop-down is for input.
Though tab can be used for input like you have done, I feel it is not a good thing to do. I was confused by the first design, as to, what should be done here. Do I Need to fill the form on each and every tab?
I would go with the drop-down.
The tabs feel separate from the contact us form itself and almost create 5 different contact us forms. I feel like the user could miss that step entirely and you will get more submissions to Sector 1 because that is the default tab.
The dropdown fits better in to the steps of the contact us form, and provides users with an easy to read, step-by-step approach. You could even remove Sector 1 as the default selection of the dropdown, and make it required. That way the user is more likely to select the correct Sector because they will be prompted to go back and select a sector in the case that they missed the dropdown.
Both of them work from a user's perspective, but, I think you will be more likely to get the submission to the correct sector with the dropdown approach.